Published: Mar 10, 2021 | Updated: Mar 30, 2021

20 Top Home Builder Red Flags: When It's Time to Walk Away

How can you tell if a home builder is the wrong builder for you? Here are our 20 top home builder red flags.

Contractor and client standing in frontof a home under construction with table with hardhat and blueprints in the foreground.

When you decide to build your dream home, finding a contractor is one of the most important decisions you will make. Some custom builders are great to work with and provide high-quality products. 

Sadly, the wrong builder can make your investment and building process difficult, costly, and stressful. 

We’d like to share some of the warning signs and homebuilder red flags you need to know in advance so you can have the best possible experience with building your new home.

Our Top 20 Homebuilder Red Flags

Some signs of a bad contractor or custom home builder would include:

  1. They won’t sign a contract. This is a huge red flag. A legitimate contractor will have a clear, concise written contract for you to sign that protects you and them.
  2. The builder asks you to sign a contract that is confusing or unclear.
  3. The estimate is too good to be true and much lower than anyone else’s. This could mean there is a problem like inferior quality materials, lack of credentials, or some type of scam.
  4. The contractor is okay with cutting corners. They rush and skip important steps, buy inferior materials, or don’t follow building codes.
  5. The home builder has many complaints on social media and poor reviews. A good contractor should have a lot more positive reviews than negative ones.
  6. They have numerous client complaints with the
  7. Better Business Bureau or the Contractor’s State Licensing Board.
  8. They keep a messy job site and don’t follow health and safety rules or OSHA guidelines.
  9. A bad contractor may consistently take a long time to communicate or communication is confusing, untruthful, or unclear.
  10. They won’t give you any references. A contractor who offers no contact with previous clients either doesn’t have any or the customers they do have are not satisfied.
  11. The builder says they don’t have time to find permits for your job and asks you to handle that. A good contractor will handle all of the permits for you and knows what is needed without any prompting from you.
  12. Multiple references and reviews say the contractor did bad work.
  13. The builder pressures you to sign a contract quickly before you research their reputation and work.
  14. They have changed their name multiple times in recent years.
  15. The builder has no proof of insurance or expects you to be liable if workers are injured.
  16. The homebuilder gives you a low rate because they say they plan to use your house for their marketing.
  17. They won’t provide a list of their subcontractors. A good contractor will be proud of the subcontractors they use.
  18. They ask for a big upfront payment of 30% or more. Most contractors will ask for about 15% upfront.
  19. The homes they built ten years ago or so are not in good shape now.
  20. They tell you they don’t need permits.
  21. They want cash up front.
Judge's gavel on a wooden desk

How to Get Money Back from a Bad Contractor

Building a custom home is a long process. Things can go wrong on a home build. But a good contractor will try to make things right and honor the contract.

If the home builder doesn’t meet the specifications of the contract they signed, it’s reasonable to tell them you are not paying the contractor for bad work that failed to meet the standards of the contract.

When a contractor does a bad job, what can you do to get your money back? 

  1. Post a factual review on social media or online review sites with proof of the shoddy workmanship.
  2. Take the contractor to small claims court.
  3. Hire an attorney if your case is worth more than your state’s small claims court limit.
  4. File a claim against the contractor’s surety bond.

Reporting Bad Contractors

If you’ve got bad contractor work on your home, there are a few steps you can take to deal with the problem. Where do you go to report bad contractors if things get out of hand?

  1. If at all possible, address the contractor directly first. See if they will resolve the issue to your satisfaction. If they refuse to make things right, then go to the next steps.
  2. File a complaint with your local Better Business Bureau.
  3. Complain to the state’s licensing board.
Home builder meeting with a client looking at blueprints on a wooden table in a white room

How to Find a Good Contractor

To find a good contractor, look for someone with a good reputation in your area with many years of experience.

What makes a good contractor? Essentially, a good custom home builder or contractor will have all the opposite qualities of the red flags we mentioned above. 

10 Things to Look for in a Good Contractor or Custom Builder

  1. Integrity and honesty.
  2. A solid contract upfront.
  3. Good communication.
  4. Solid references and quality work that you can see for yourself.
  5. Fair pricing.
  6. Quality craftsmanship and products that last for many years.
  7. Protection of the health and safety of the workers and subcontractors.
  8. Carrying proper insurance and licensing.
  9. Ethical and legal practices.
  10. A good reputation online and by word-of-mouth.
Kitchen with white shaker cabinets, bronze pendant lights, and marble tile backsplash|Blythe Custom Homes

Looking for a quality home builder you can trust in the Lexington, SC area?

At Blythe Building Company, we build luxury homes all over the Midlands of South Carolina. We’ve been in business for over 16 years and are happy to provide you with all the information and references you need to feel confident in our ability to take great care of your new home build.

Please contact us today to get started on your dream home!

We build in areas like Lexington, Lake Carolina, downtown Columbia, Ballentine, Chapin, West Columbia, Forest Acres, and more.


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